Metropolitan Bank & Trust Co. · PSE:MBT
Metropolitan Bank & Trust — FY2021 Earnings Presentation
50 slides from Metropolitan Bank & Trust's earnings presentation, February 2022
Slide 1: FY 2021 Earnings Call
FY 2021 EARNINGS CALL
Slide 2: Private and Proprietary
PRIVATE AND PROPRIETARY © Metropolitan Bank & Trust Company | Investor Relations | February 2022 | MBT Company Presentation 2 This material was produced by Metrobank for information purposes only and is intended to be used in presentations by the Bank at investor meetings and does not constitute a r
Slide 3: Macroeconomic View
PRIVATE AND PROPRIETARY MACROECONOMIC VIEW © Metropolitan Bank & Trust Company | Investor Relations | February 2022 | MBT Company Presentation 3 This material was produced by Metrobank for information purposes only and is intended to be used in presentations by the Bank at investor meetings and does
Slide 4: Economy picks up amid vaccinations and fewer cases
PRIVATE AND PROPRIETARY Economy picks up amid vaccinations and fewer cases Economic rebound being sustained Local vaccination program continues to gain traction 12.0 Share of people fully vaccinated against COVID-19, as of February 2022 6.3 6.1 5.6 6.8 6-7 6.6 6.9 7.7 0.0% 10.0% 20.0% 30.0% 40.0% 50
Slide 5: Overall expectations steadily improving
PRIVATE AND PROPRIETARY Overall expectations steadily improving Unemployment level still elevated More optimistic expectations Capacity utilization still low Next 3 months 17.6% 75.1 74.9 Business Consumer 60.0 56.1 52.0 52.8 50.0 42.3 42.8 70.6 70.1 37.4 69.6 69.8 47.6 10.0% 40.0 40.3 31.4 8.9% 67.
Slide 6: Monetary policy still accommodative in the near term
PRIVATE AND PROPRIETARY Monetary policy still accommodative in the near term Inflation rate eases as food and utility prices normalize Steepening yield curve YE 2019 YE 2020 YE 2021 FEB 2022 5.50 3.0% 5.00 Movement (in bps) FY21 avg: 3.9% 4.50 YoY MoM FY20 avg: 2.4% 1M -25 3 Jul-20 Jul-21 Jan-20 Jun
Slide 7: Rising National Government Debt
PRIVATE AND PROPRIETARY Rising National Government Debt Domestic Debt External Debt Debt-to-GDP % External 35 70% 60% 62% 60% 30 55% 50% 49% 49% 47% 50% % Debt-to-GDP; % External Total Debt (in PHP Trillions) 43% 43% 25 40% 40% 40% 40% 40% 42% 42% 20 36% 35% 35% 34% 34% 33% 33% 34% 30% 32% 30% 30% 2
Slide 8: GDP Forecasts
PRIVATE AND PROPRIETARY Metrobank Economic Research Forecasts As of February 2022 2020A 2021A 2022F 2023F GDP -9.6% 5.6% 6.8% 6 – 7% Inflation 2.4% 4.5% 3.4% 3 – 4% BSP RRP rate 2.0% 2.0% 2.5% 3.0% USDPHP Trend 48.0 50.8 52.1 53.4 DISCLAIMER INFORMATION DBCC* 7.0% - 9.0% N/A The report above is circ
Slide 9: Banking Industry: Loan recovery amid improving NPLs
PRIVATE AND PROPRIETARY Banking Industry: Loan recovery amid improving NPLs Recovery in loan growth continues, asset quality improves Deposit growth sustained amid ample market liquidity Loan growth Deposit growth CASA growth 20% 31% 40% 16% 17% 19% 16% 35% 14% 11% 30% 25% 34% 16% 18% 15% 15% 5% 12%
Slide 10: Financial Performance
PRIVATE AND PROPRIETARY FINANCIAL PERFORMANCE FY 2021 © Metropolitan Bank & Trust Company | Investor Relations | February 2022 | MBT Company Presentation 10 This material was produced by Metrobank for information purposes only and is intended to be used in presentations by the Bank at investor meeti
Slide 11: Strong income rebound in 2021 amid lower provisions
PRIVATE AND PROPRIETARY Strong income rebound in 2021 amid lower provisions Net Interest Income Fees and Other Non-Interest Income Trading & FX gains Operating expenses Provisions for credit losses Taxes and NCI YoY YoY 50.0 28.1 13.8 22.2 +60% 6.5 6.1 3.0 1.9 2.8 7.8 3.9 4.4 6.0 +117% 150.0 40.0 30
Slide 12: Net interest income steady as NIM stabilizes
PRIVATE AND PROPRIETARY Net interest income steady as NIM stabilizes Weak net interest income driven by lower asset yields Margins starting to stabilize Pbn Interest Income Interest expense Pbn NII Quarterly NIM 130.0 77.0 86.1 75.0 • Lower lending rates; 30.0 credit card rate cap 3.7% 3.5% 110.0 4.
Slide 13: Loan demand recovering, driven by corporate sector
PRIVATE AND PROPRIETARY Loan demand recovering, driven by corporate sector Commercial demand drives loan recovery Excess client funds still parked in CASA Pbn Consumer Commercial MBT Gross Loans growth MBT CASA growth GDP -8% -4% +12% +7% +8% -1% YoY 1,297 1,279 +5% QoQ 22% 1,207 1,210 1,220 16% 13%
Slide 14: Corporate segment driving loan demand
PRIVATE AND PROPRIETARY Corporate segment driving loan demand Corporate and middle market sustains recovery Significant rebound in short-term loans Pbn SME Corporate & Middle Market Long Term (More than 1 Year) Short Term (Up to 1 Year) 1,200 1,011 +2% YoY 995 +6% QoQ +7% YoY 1,000 920 933 950 22% 2
Slide 15: CASA to loans ratio still higher than pre-pandemic levels
PRIVATE AND PROPRIETARY CASA to loans ratio still higher than pre-pandemic levels Parent Corporate and Commercial CASA to Loans ratio Parent CASA to Loans ratio, selected industries 110% 120% 100% 109% 107%110% Wholesale and 110% 93% Commercial/SME 104% Retail Trade 88% CASA +14% YoY 99% CASA + 6% Y
Slide 16: Soft retail demand, still cautious on big ticket spending
PRIVATE AND PROPRIETARY Soft retail demand, still cautious on big ticket spending Consumer Loans Breakdown Consumer Loans By Product Pbn Others Auto Housing Credit Card 303 286 -11% YoY 31% 30% 31% 32% 34% 276 270 269 -0.5% QoQ 93 87 86 87 -1% YoY 92 +5% QoQ 35% 36% 36% 36% 36% 106 103 101 98 -8% Yo
Slide 17: Healthy CASA growth maintained
PRIVATE AND PROPRIETARY Healthy CASA growth maintained Robust CASA growth; lower high-cost TDs CASA ratio remains elevated Pbn TDs CASA CASA TDs +7% YoY 1,930 +4% QoQ 27% 25% 26% 25% 24% 1,797 1,817 1,851 1,738 73% 75% 74% 75% 76% 4Q20 1Q21 2Q21 3Q21 4Q21 +12% YoY 1,342 1,387 1,463 +5% QoQ 1,311 1,3
Slide 18: Net interest margin staying steady
PRIVATE AND PROPRIETARY Net interest margin staying steady Asset yields and funding costs stabilizing Steady yields across loan segments 25.0% Quarterly NIM Asset yield Loan yield Funding cost Deposit cost 20.3% 19.5% 20.0% 18.9% 6.9% 7.50% Credit Cards 6.4% 6.5% 6.50% 6.0% 5.7% 5.8% 5.7% 5.5% 5.2%
Slide 19: Healthy fee income easing impact of lower trading gains
PRIVATE AND PROPRIETARY Healthy fee income easing impact of lower trading gains Non-Interest Income Breakdown Fee-based income re Pbn Others Leasing Pbn Fee income Trust income Service Fees & Trust Trading & FX gains YoY 17.0 7.0 40.0 15.1 +15% 6.0 15.0 +15% YoY 35.8 14.0 13.1 1.7 5.0 35.0 YoY 13.0
Slide 20: Costs kept under control
PRIVATE AND PROPRIETARY Costs kept under control Operating Expenses Breakdown Cost-To-Income Ratio Pbn Others Occupancy & equipment Depreciation Taxes & licenses Manpower 38.0 78.0 65.0% YoY 59.0% 59.0% 57.2% 68.0 33.0 60.0% 60.1 59.5 -1% 54.6% 54.6% 55.0% 58.0 28.0 50.0% 49.6% 48.0 24.9 25.3 23.0 +
Slide 21: Stable NPLs and ample reserves give room to lower provisions
PRIVATE AND PROPRIETARY Stable NPLs and ample reserves give room to lower provisions Easing credit costs Hefty provision cover Est. Credit Cost (bps) 350 293 300 250 200 150 70 92 175% 100 50 163% - Pbn Cumulative Total Allowance Provisions for Credit 60.0 60 50 48 50.0 50 40.0 40 41 30.0 30 103% 20
Slide 22: Asset quality much better than industry
PRIVATE AND PROPRIETARY Asset quality much better than industry NPL and Past Due loans continue to taper off NPL and Past Due ratios much lower than industry Past Due ratio Industry Past Due Pbn Past Due NPL 4.5% 4.7% 5.0% 4.5% 4.0% 60.0 60.0 2.7% 3.5% 3.0% 2.5% 50.0 50.0 3.0% 2.8% 2.0% 1.5% 39 1.9%
Slide 23: Asset quality still much better than industry
PRIVATE AND PROPRIETARY Asset quality still much better than industry Stable restructured loans ratio, but still sub 1% Combined NPLs/Restructured still below Industry NPL Ratio Ratio to Gross Loans Industry Restructured Loans Ratio Industry NPL Ratio 4.5% 3.1% Combined NPL + Restructured Loans as R
Slide 24: Asset quality management across loan segments
PRIVATE AND PROPRIETARY Asset quality management across loan segments Commercial NPL ratio stays subdued …as well as consumer NPL ratio NPLs NPL ratio NPL ratio Industry Consumer NPL ratio 16.0% 9.3% 9.9%* 25 3.0% 14.0% 23 1.6% 1.6% 2.0% 12.0% 1.0% 10.0% 21 1.0% 8.0% 4.1% 5.3% 19 6.0% 4.2% 17 0.0% 4
Slide 25: Consumer NPLs well below industry levels
PRIVATE AND PROPRIETARY Consumer NPLs well below industry levels Auto Home Credit Cards NPLs NPL ratio Industry NPLs NPL ratio Industry NPLs NPL ratio Industry 9.6% * 20 12.7% * 14.0% 18 20 9.2% 15.0% 8.9% 10.7% 20 12.0% 18 15% 16 18 10.0% 16 8.0% * 14 16 10.0% 14 8.0% 10% 5.8% 14 12 5.2% 6.0% 12 3.
Slide 26: Other asset quality indicators remain stable
PRIVATE AND PROPRIETARY Other asset quality indicators remain stable Real and other properties acquired (ROPA) Non-Performing Assets (NPA) Pbn Pbn ROPA Ratio to Gross Loans NPA NPA Ratio 15.0 0.8% 0.8% 0.9% 50 1.7% 1.9% 13.0 0.7% 0.8% 45 1.5% 1.7% 1.5% 0.7% 11.0 0.6% 40 1.2% 1.3% 9.0 1.1% 0.5% 35 0.
Slide 27: Strong balance sheet, healthy capital levels provide ample support
PRIVATE AND PROPRIETARY Strong balance sheet, healthy capital levels provide ample support Capital Ratios significantly above minimum thresholds Formidable Basel III Leverage Ratio, Liquidity Coverage Ratio CAR CET-1 BLR LCR 20.2% 20.1% 19.3% 19.3% 350% 327% 15.0% 303% 17.5% 300% 16.2% 10.9% 11.4% 1
Slide 28: Dividend Declaration in 2022
PRIVATE AND PROPRIETARY Dividend Declaration in 2022 1. Tempered near-term growth prospects Modest loan demand in 2022, with pre-pandemic double-digit growth possible by year 2023 onwards Key information Regular Cash • Php1.60 2. Strong NPL risk buffers already in place Dividends • Semi-annual payou
Slide 29: 2022 Outlook – Positives and Challenges Ahead
PRIVATE AND PROPRIETARY 2022 Outlook – Positives and Challenges Ahead • Sustained pick-up in loans as economy recovers • Delay in economic recovery due to threat of new lockdowns and global market developments could • NIM recovery on prospects of rising benchmark stall loan recovery. rates/yields hi
Slide 30: Digital Initiatives
PRIVATE AND PROPRIETARY DIGITAL INITIATIVES FY 2021 © Metropolitan Bank & Trust Company | Investor Relations | February 2022 | MBT Company Presentation 30 This material was produced by Metrobank for information purposes only and is intended to be used in presentations by the Bank at investor meeting
Slide 31: Metrobank digital transformation
PRIVATE AND PROPRIETARY Metrobank digital transformation Digital and data will radically transform the way the bank will operate: 1 Customer experience excellence MB Online MB Mobile App 2 Operational efficiency 3 Consumer business growth 4 Real-time controls 5 High-touch financial advisory and educ
Slide 32: Best in class servicing and engagement
PRIVATE AND PROPRIETARY Best in class servicing and engagement Drive customer financial wellness via customized data-driven insights and advisory Segment-specific MASS HPR HNWI INSTITUTIONAL RM/BM RM/BM Digital-first Assisted by digital Assisted by digital Transactions, servicing, acquisition Mo
Slide 33: Digital Transformation to Drive Business Transformation
PRIVATE AND PROPRIETARY Digital Transformation to Drive Business Transformation Building Blocks Empowerment Engagement and Education 2019-2023 Enabling self-service, branch offload Deeper engagement with existing customers, expanding into new markets, educating the market on finances Systems Upgrade
Slide 34: Digital metrics on retail clients
PRIVATE AND PROPRIETARY Digital metrics on retail clients 26% Digital users among retail clients as of FY 2021 2021 88% 12% vs 24% in FY 2020 2020 85% 15% 92% Active users +46% YoY +50% YoY among Transaction Transaction 2019 82% 18% enrolled retail count amount as of FY 2021 % E-Channels to Poised t
Slide 35: Summary
PRIVATE AND PROPRIETARY SUMMARY Metrobank sustained strong earnings growth in 2021. Proactive NPL management has enabled the Bank to lower provisions. We will continue with our prudent risk management strategy even as asset quality continues to improve. The Bank saw healthy growth in fees and other
Slide 36: Financial Summary
PRIVATE AND PROPRIETARY Financial Summary In PHP billion Balance Sheet FY 2020 FY 2021 YoY Income Statement FY 2020 FY 2021 YoY Total Assets 2,455 2,503 +2% Net Interest Income 86.1 75.0 -13% Loans and Receivables, Gross 1,297 1,279 -1% Total Deposits 1,797 1,930 +7% Non Interest Income 35.8 26.4 -2
Slide 37: Additional Information
PRIVATE AND PROPRIETARY Additional Information © Metropolitan Bank & Trust Company | Investor Relations | February 2022 | MBT Company Presentation 37 This material was produced by Metrobank for information purposes only and is intended to be used in presentations by the Bank at investor meetings and
Slide 38: Metropolitan Bank & Trust Company (Metrobank)
PRIVATE AND PROPRIETARY Metropolitan Bank & Trust Company (Metrobank) Overview Financial Data (PHP bn) 2021 DIVERSIFIED Total Assets 2,503 59 YEARS OF MULTI-AWARDED FINANCIAL CONGLOMERATE TRADING INFORMATION MBT PM | MBT.PS Ticker Loans and Receivables, Gross Total Deposits 1,279 1,930 SERVICE EXCEL
Slide 39: Ownership and Investment Information
PRIVATE AND PROPRIETARY Ownership and Investment Information CORPORATE STRUCTURE MARKET DATA Trading information Ticker: GTCAP PM / GTCAP.PS Market cap: USD2.4 Bn Ty Family Ticker (Bloomberg | Reuters) MBT PM | MBT.PS & Other Free Related float Par value (PHP) 20.00 Parties Outstanding shares 4,497,
Slide 40: Extensive Domestic and Overseas Coverage
PRIVATE AND PROPRIETARY Extensive Domestic and Overseas Coverage 17,000+ employee base Domestic Branch and ATM Networks Overseas Network Coverage 950+ 30+ branches Branches, subsidiaries, offices 2,300+ ATMs 140+ Remittance tie-ups 150+ Remittance agents © Metropolitan Bank & Trust Company | Investo
Slide 41: Recent Awards and Recognition
PRIVATE AND PROPRIETARY Recent Awards and Recognition Best Local Currency Best Best Bond Individuals 8th Best Workplace Strongest Bank Top GSED to Grow Your Career Domestic Bank in Securities House #1 in Trading, in the Philippines Market Maker #2 & #3 in Sales, – Philippines the Philippines Bank Ca
Slide 42: 2020 Sustainability Measures
PRIVATE AND PROPRIETARY 2020 Sustainability Measures Reduce environmental 9% impact 13% 18% Php606.9Bn Estimated 14% Support Sustainability Contribution of social causes Commitment Outstanding Loans to UN SDGs 24% 20% Improve our governance standards Source: 2020 Sustainability Report © Metropolitan
Slide 43: Sustainability: Our Progress In 2021
PRIVATE AND PROPRIETARY Sustainability: Our Progress In 2021 At Metrobank, sustainability is tied to its founding mandate to help in nation-building. We are committed to support the national development agenda and contribute in addressing the foremost challenges and opportunities of the Philippines
Slide 44: Debt Issuances
PRIVATE AND PROPRIETARY Debt Issuances Unissued 19.0 Bond Issuance 2021 28.0 0.5 Php19.0 billion USD2 Billion 2020 Php100 Billion Bond 10.5 Medium-Term 5.25Y Peso Notes Note Listed June 2021 Programme 2019 Programme 1.9x oversubscribed 1.5 3.60% interest rate, 35bps above 2018 42.5 benchmark rate ©
Slide 45: Outstanding Debt Issuances & Investment Grade Credit Ratings
PRIVATE AND PROPRIETARY Outstanding Debt Issuances & Investment Grade Credit Ratings Debt Issuance Details Debt Maturity Profile (PHP Bn) Baa2 Dec-21 Issue Coupon Maturity Amount Stable Type Date Rate Date (PHP Bn) • Highly correlated with sovereign rating 2021 28.00 Nov-14 4.250% Nov-21 6.25 as exp
Slide 46: Loan Portfolio Breakdown
PRIVATE AND PROPRIETARY Loan Portfolio Breakdown MBT Loan Portfolio By Industry Philippine Banks Loan Portfolio By Industry 14% 13% 13% 13% 13% 12% 12% 12% 12% 12% 13% 12% 13% 11% 11% 11% 11% 11% 13% 13% 17% 17% 19% 19% 20% 20% 20% 17% 17% 18% Trade Manufacturing 9% 11% 12% 12% 10% 10% 10% 10% 11% 1
Slide 47: Currency Breakdown
PRIVATE AND PROPRIETARY Currency Breakdown LOAN PORTFOLIO DEPOSITS Foreign Foreign Currency, Currency, 15% 18% Philippine Peso, 85% Philippine Peso, 82% © Metropolitan Bank & Trust Company | Investor Relations | February 2022 | MBT Company Presentation 47 This material was produced by Metrobank for
Slide 48: COVID-19 Initiatives
PRIVATE AND PROPRIETARY COVID-19 Initiatives For Employees For Clients For Communities Flexible work arrangements Waived Interbank Fund Transfer Fees Shifting schedules, remote work, redeployment to nearer worksite For InstaPay and PESONet, until 30 June 2021 Adjusted PESONet Fees Additional allowan
Slide 49: For more information, please visit our website
PRIVATE AND PROPRIETARY For more information, please visit our website: Latest Annual Reports 2020 2019 2018 Financial Reports SEC 17-A SEC 17-Q BSP SOC Investor Relations https://metrobank.com.ph/about-us/investor-relations-program Annual Corporate Governance Report For your comments and queries co
Slide 50: 50 This material was produced by Metrobank for information purposes only and is intended
PRIVATE AND PROPRIETARY by © Metropolitan Bank & Trust Company | Investor Relations | February 2022 | MBT Company Presentation 50 This material was produced by Metrobank for information purposes only and is intended to be used in presentations by the Bank at investor meetings and does not constitute
Metropolitan Bank & Trust Company — FY2021 Earnings Presentation on 6ix